Tshwane overhauls utilities to boost services, secure funds
The City of Tshwane has officially met the National Treasury’s 1 July deadline for transitioning its electricity, water, and sanitation departments into ring-fenced business units.
The move is being hailed as a landmark step toward better governance, improved service delivery, and long-term infrastructure resilience.
The sweeping reform comes in response to the Municipal Finance Management Act (MFMA) and the 2021 Municipal Budget and Reporting Regulations, which require large metros to separate operational finances from other city budgets for improved transparency and accountability.
On Thursday, City Manager Johann Mettler said the change marks far more than just compliance, and represents a fundamental shift in how Tshwane governs its basic services.
"By establishing these business units, we're not just meeting national regulations — we're fundamentally improving how we deliver essential services."
Mettler briefed media on the metro's transition of electricity, water, and sanitation services into ring-fenced business units on Thursday.
CENTRALISED MODEL TO BOOST EFFICIENCY
The reform has replaced the city’s outdated dual-operating model, which split responsibilities between central and regional offices, often causing delays and inefficiencies.
The newly established Energy & Electricity and Water & Sanitation Business Units will now operate under a centralised structure, ensuring dedicated operational management, ring-fenced finances, and clearer accountability.
"The smooth transition demonstrates our commitment to both good governance and our residents’ quality of life," Mettler said.
"Looking ahead, we remain as a city focused on performance-based incentives for service improvements, continued public participation in service reviews, and in ongoing infrastructure upgrades."
Mettler added that a key motivation behind the reform was the need to protect access to National Treasury grants, which fund vital infrastructure upgrades and service delivery across Tshwane’s communities.
"This wasn’t just about ticking boxes. It was about protecting the grants that allow us to keep our communities serviced.
"We have established the two business units, in energy and electricity, and in water and sanitation. They align not only with the National Treasury's mandate, but also with our own mandate of enhancing the quality and the level of services to our communities."
Failure to implement the changes by the 1 July deadline could have resulted in the loss of billions in public funding, jeopardising electricity and water projects in underserved areas.
Mettler confirmed that no job losses occurred during the transition, and that all city employees were absorbed into the new structure after extensive stakeholder consultations, including unions, industry partners, and community organisations.
FUTURE-PROOFING INFRASTRUCTURE AND SERVICES
The city says the transformation is also aimed at future-proofing its ageing infrastructure in the face of rising demand, budget constraints, and climate-related pressures.
By ring-fencing utility revenues, Tshwane will now be able to reinvest earnings directly into maintaining and upgrading key infrastructure, such as substations, water treatment plants, and stormwater systems.
"We’re ensuring the durability, reliability, and lifespan of our infrastructure while reducing service breakdowns and building public confidence," Mettler explained.
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